Prime Minister Anthony Albanese and Treasurer Jim Chalmers have been under sustained pressure coming into the new year over the ongoing squeeze on household budgets.
Inflation is still high – 4.3 per cent by November’s monthly measure – and the last Reserve Bank interest rate rise which took the official cash rate to 4.35 per cent was just two months ago.
This week, Albanese said the government was looking at ways it could help with the pressure on households and would make announcements ahead of the May budget.
Albanese and Chalmers face some tough decisions in the coming months.Credit: Marija Ercegovac
“I’ve asked Treasury and Finance to continue to come up with ideas in ways in which we can assist with cost of living, but without putting pressure on inflation,” the prime minister said on Triple M Adelaide on Wednesday.
But economists warn that giving people what they ask for means difficult decisions for the government.
“It’s true of any government around the world, they’d love to be helping, who wouldn’t love to help an electorate that’s hurting? The problem is, it’s really hard to do,” independent economist Chris Richardson said.
The Labor government has already introduced a range of measures, including cheaper prescription medicines, increased Commonwealth Rent Assistance and JobSeeker, and $1.5 billion in energy bill relief for low-income households.
Brendan Coates, economic policy program director at the Grattan Institute, said the government could extend energy bill relief and increase rent assistance and unemployment benefits without injecting too much cash into the economy.
What could the federal government do to ease cost-of-living pressure? The answer is complicated
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17.01.2024
Prime Minister Anthony Albanese and Treasurer Jim Chalmers have been under sustained pressure coming into the new year over the ongoing squeeze on household budgets.
Inflation is still high – 4.3 per cent by November’s monthly measure – and the last Reserve Bank interest rate rise which took the official cash rate to 4.35 per cent was just two months ago.
This week, Albanese said the government was........
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